The bank is already the parent company of ETF sponsor iShares, and controls 40% of the U.S. exchange-traded market. If this sounds like there are going to be a deluge of ETFs, you're not alone.

Here's what Josh Brown, VP of Fusion Analytics, had to say about it (via WSJ):

As a result of that crudely-sketched dialog between fund company and index-monger we now have Concrete ETFs, Rare Earths ETFs, Global Aquaculture (Fishing!) ETFs, ETFs that hold only metals that are the color white (look it up – WHITE, I kid you not) and a lot of these things are based on indexes created specifically for the product. Not that there’s anything wrong with that per se, but at what point are we just indexing past the point of any meaning for everyday investors?

While older ETFs offered a cheap means of diversification, new ETFs can be expensive and they can be risky.

Sometimes assets underlying an ETF are not as liquid as you need them to be to easily buy and sell an index. Notably two thirds of the trades that were canceled in the Flash Crash were ETFs. Furthermore complex derivatives can expose investors to unknown risky assets.

Other ETFs -- certainly the kind we expect from Blackrock -- are too complex for the average investor to understand, and many of them are highly leveraged. If you don't understand how a particular ETF works then you probably don't want to buy it.